Op-ed: Ukraine’s road to reform

Here is a little-known fact. In 1990, as the Soviet Union was collapsing, Poland’s GDP was just 20% larger than Ukraine’s. Both countries were relatively similar in size and population.

Konrad Pawlik.

Two
and a half decades later, the gulf has widened. Poland’s
economy has grown steadily at around 5% annually for much of the period, while Ukraine has
stagnated. Why is this?

An
obvious difference has been Poland’s
accession to the European Union. But this, of itself, is insufficient to
explain the different trajectories of these two countries post communism. There
are two additional crucial factors, both of which provide important lessons for
the EU today.

The
first is the ability of a country to follow its own, sovereign path, without
undue interference from powerful neighbours. Poland had this window of
opportunity in the 1990s. Ukraine,
on the other hand, is not being given the chance.

The
conflict in east Ukraine
has been raging for over a year and a half now. It is fuelled by Russian
weapons and soldiers. Russia
has also illegally annexed Crimea, a piece of
Ukrainian territory, while continuing to destabilise the rest of the country.
It has created a humanitarian crisis with over 1.5 million internally displaced
people. And the Kremlin’s destructive propaganda is trying every day to
undermine the legitimate, democratically elected Government in Kyiv.

The
lesson for the EU here is that we must remain firm in our conviction to
dissuade the Kremlin from this path. It is right that EU Foreign Ministers
renewed sanctions on Russia
last month, with one united voice. It is also right that they remain in place
until the Minsk
agreements are implemented – in full.

We
must continue with our diplomacy, both via the EU and bilaterally, to persuade Russia’s decision-makers that destabilising Ukraine is in
no-one’s interests, let alone their own.

But
the second crucial differentiator between Poland
and Ukraine has been Poland’s
democratic and market reforms. Poland
now has a thriving civil society and media, a market economy and competitive
businesses.

These
are not easy tasks. But successive Polish governments, business and civil
society leaders have devoted themselves to these efforts over the past two and
a half decades. And in Poland
and the UK
alike we see the benefit of being globally competitive, open trading nations.
In Poland, tens of thousands of new businesses have been created and foreign investment
has thrived with thousands of foreign firms providing jobs and exports for the
country. Furthermore bureaucracy and regulation have been cut. The UK and
Poland continue to work on this task together in the EU and beyond.

Ukraine
is now turning to the same path, inspired by the tens of thousands of
Ukrainians who took to the streets of Kyiv last year to demand a better future.

These
efforts are bearing early fruits. Ukraine’s parliament has started reform
across areas such as policing, tax reform, agriculture, and healthcare.
Kyiv is also tackling some more difficult areas, such as judicial reform and
anti-corruption. As a very practical example, last month the Ukrainian
government created a new web-portal to provide services direct to citizens,
squeezing out corruption and unnecessary bureaucracy.

We
should applaud this progress. Others do. Recently a senior figure from
the IMF – an organization not usually given to hyperbole – said that the new
Ukrainian Government is the ‘most reform-oriented government’ that he had
encountered in 20-plus years of dealing with Ukraine.

But
there is still much more to do: reducing red tape, creating a climate where
businesses can thrive, and curtailing the influence of oligarchs. We, the
European Union, must do all we can to help these efforts. This requires
practical support.

The
UK’s new Good Governance Fund, and the EU’s Support Group for Ukraine are
examples of this. Poland has also assisted Ukraine in its transformation
efforts since 2005, spending close to 90m Euro of its Official Development
Assistance between 2005 and 2014. Since 2014, it has intensified support to
Ukraine focusing on decentralization and good governance, as key drivers of
change in a transformation period.

Furthermore, it has dispatched a team of Poland’s most prominent experts to
help draft and implement legislation and train personnel, especially in the
field of decentralization. And this year Poland has again boosted its support
to help introduce anti-corruption measures and to reform Ukraine’s public
finance.

However,
Ukraine’s democratic transformation will take time. We all know from our own
experience, the road to reform is a long one. It will require patience and
determination on the part of the Ukrainian people and their elected officials.

Equally
importantly, it will require patience and determination from the European
Union. The rights we enjoy, protected by the institutions and laws we often
take for granted, were not secured overnight – they took time to develop and
embed within our own societies.

So
we urge our partners in Europe to reaffirm their commitment to support the
efforts being made in Ukraine to carry through both economic and political
reforms. Despite the challenge of the conflict in the east, the last year has
seen welcome moves forward. We should support the government and people of
Ukraine as they commit themselves to a programme of reform for the months and
years ahead.

EU economy’s future: slow but positive growthGrowth in all EU states will continue in 2019-20, though at a slower pace than before. The largest EU’s economies will grow at around 1,5-1,7%, mostly in Poland, Spain and Holland. The Baltic States’ growth will continue to be on the positive trend.